A new boost for Vietnam - US investment and trade cooperation

US President Joe Biden conducts a state visit to Vietnam from September 10 to September 11, 2023, at the invitation of General Secretary Nguyen Phu Trong.

>> Vietnam, US witness strides in trade connections

Relation upgrade

Since establishing a comprehensive partnership ten years ago, Vietnam and the United States have focused on nine areas: politics - diplomacy, trade and economic relations, science and technology, and education, environment and health, war legacy issues, defense - security, promotion and protection of human rights, culture, tourism, and sports.

The brightest areas among them are trade and investment. Two-way trade turnover between Vietnam and the US has expanded more than 4.2 times over the last decade, from 29 billion USD to 123 billion USD, becoming the US Vietnam's second largest trading partner.

Because of the high demand and diversified customer tastes, there are several prospects for Vietnamese goods to reach the US market. In addition, the number of overseas Vietnamese in the US provides a firm platform for Vietnamese enterprises to gradually launch and market their products in the US.

Currently, all main groupings of commodities manufactured in Vietnam are available in the United States, including textiles, wood, agricultural and aquatic products, shoes, computers, electronic components, and so on. Vietnamese items are widely available in the United States, however they lack depth and new sectors. This is the place for the two nations' economic community to continue to grow.

According to the General Statistics Office, US direct investment in Vietnam reached 11.73 billion USD in June of this year, with over 1,200 projects, ranking 11th among nations and territories investing in Vietnam.Professor Carlyle Alan Thayer of the Australian Defense Force Academy said, "trade and investment remain at the heart of the Vietnam-US bilateral relationship. In the context of an uncertain global economy, the US desires a safe and flexible semiconductor supply chain from Vietnam, while Vietnam seeks increased investment and access to the US market”.

>> Will the US economy continue a brisk recovery?

During US President Joe Biden's visit to Vietnam, Vietnam and the US announced the formation of the Comprehensive Strategic Partnership for Peace, Cooperation, and Sustainable Development, a significant, historic upgrade from the present Comprehensive Partnership.

Mr. Nguyen Phu Trong, General Secretary of the Communist Party of Vietnam (CPV) Central Committee, expresses his deep appreciation for the agreed-upon contents of the Joint Statement elevating Vietnam-US relations to a Comprehensive Strategic Partnership for Peace, Cooperation, and Sustainable Development.

The US President Biden praised the bilateral relationship's advancement to a Comprehensive Strategic Partnership, which benefits both nations while also serving common world goals.

General Secretary Nguyen Phu Trong and President Joe Biden at the press conference following their talks in Hà Nội on Sunday.

What to expect in the future?

Following the COVID-19 epidemic, numerous prominent US officials have traveled to Vietnam. This is a clear example of the United States' policy of moving and diversifying the supply chain, as well as growing partners in Southeast Asia. According to US Treasury Secretary Janet Yellen, "Vietnam is an important intersection in the global semiconductor supply chain."

This is demonstrated by the significant investments made in Vietnam by Intel, Cargill, Coca-Cola, and others. Especially since the US and other European nations "tightened" their investment in Chinese semiconductor technology, Vietnam has gained a favorable position in the US and China's global supply chain.

Vietnam is particularly interested in cyber security, digital economy, big data, and so on. This has the potential to further strengthen bilateral relations between Vietnam and the United States. Meta, Alphabet, and Amazon may all build regional servers in Vietnam. If this "push" succeeds, Vietnam will be in a fundamentally different position in Asia-Pacific.

Aside from the fact that the United States started the COP26 pledge, Vietnam is an active participant, with hundreds of nations making commitments to cut emissions to zero by 2050. The agreement on how to tackle climate change would make it easier for US renewable energy businesses to enhance their investment in Vietnam in order to accomplish similar goals.

Vietnam-US economic connections have grown at a pace of nearly 20% each year, demonstrating that the two countries' potential for collaboration is enormous. Vietnam wishes to gain access to the vast US market in terms of money, science and technology, managerial capabilities, and so on. While US corporations want to enter the Vietnamese market, they also seek major reforms to improve the business and investment climate in Vietnam. This is a stage at which the two parties may exchange ideas in order to discover solutions to build cooperative relationships.